1 Harnessing the Power of Organizational Alignment:

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1 Harnessing the Power of Organizational Alignment:

Transcript of 1 Harnessing the Power of Organizational Alignment:

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Harnessing the Power of Organizational Alignment:

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Static AlignmentStatic Alignment

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Dynamic AlignmentDynamic Alignment

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A Seamless Culture of Shared Purpose

The Goal of Strategic The Goal of Strategic AlignmentAlignment

““Alignment is the essence Alignment is the essence of management” of management” Fred Smith, FedEx

“Well aligned companies outperform their competitors on every major financial measure.”

George Labovitz and Harvard Business School

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The Reality

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of people don’t feel their company

strategy will lead to success … Booz 2011

53%53%

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of employees would leave if given

the opportunity … The Economist, 2011

80%80%

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of the time the problem is not bad

strategy but bad execution … Fortune, 2010

70%70%

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of workers don’t believe they are

supporting company strategy … Duncan Group 2011

73%73%

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of companies do not implement

their strategy effectively … Kaplan and Norton

90%90%

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of CEOs believe strategic changes

are implemented poorly… Grolman Group

85%85%

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say organizational disconnects and

silos are the most significant challenge… 2010 PMO 2.0 Trending Report

68%68%

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Contributions to Company Contributions to Company ValuationValuationIntangible assets are Intangible assets are responsible for responsible for 70%70% of value of value

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Ernst and Young, 2009

LeadershipLeadershipCultureCultureInnovationInnovationEngagementEngagementAlignmentAlignment

TangibleTangibleAssetsAssets

IntangibleIntangibleAssetsAssets

Employee engagement Employee engagement a pre-condition and result of correct alignmenta pre-condition and result of correct alignment

Engagement is the outcome of one’s personal

• Satisfaction• Commitment• Pride• Loyalty• Sense of purpose

• Advocacy• Initiative• Persistence• Energy

A 50% spread in observed performance

Companies with high levels of People Engagement improved 19.2%Companies with low levels of People Engagement declined 32.7%

Towers Watson

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Engagement and the Bottom line

Wealth Creation

The EPS growth rate of organizations with engagement scores in the top quartile was 2.6 times greater than organizations with below average scores.

Gallup (survey of 89 organizations)

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Engagement and the Bottom line

Safety

Those with engagement scores in the bottom quartile averaged 62% more accidents.

Gallup

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Engagement and the Bottom line

Productivity

Engaged people are consistently more productive, profitable, safer, healthier, and 87% less likely to leave their employer.

Corporate Leadership Council & Fleming & Apslund

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Engagement and the Bottom line

Engaged teams are not enough. They must also be aligned to the goals of the entire organization.

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But …But …

Aligned teamsAligned teams

Know there’s a planUnderstand the planAgree with the plan Buy into the planEnergize the plan

Looking for Alignment Looking for Alignment - - Key Key QuestionsQuestions

1.1. What is our strategy?What is our strategy?2.2. What do you do?What do you do?3.3. How does what How does what youyou do support the strategy? do support the strategy?

If a majority of employees feel aligned, the company is alignedIf a majority of employees feel aligned, the company is aligned

Common Symptoms of Poor Common Symptoms of Poor AlignmentAlignment

• High turnover• Inability to articulate strategy• Lack of accountability• Information hoarding• Poor teamwork• Little upward information flow• Fragmentation and duplication• Inappropriate or misguided initiative• Excessive focus on short-term results• Team goals trump corporate strategy • Institutional apologists• ‘Vest and Rest’ syndrome

Looking for AlignmentLooking for AlignmentThe key questionsThe key questions

•Is the strategy clear and well-communicated?•Is leadership aligned to deliver unambiguous direction?•Do the processes work efficiently, or are there built-in conflicts?•Do I have a clear understanding of customer needs?•How does alignment impact attrition, retention, profitability and sustainability?

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The Main Thing

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The Main Thing is to keep the Main Thing the Main Thing

Quantitative alignment analytics can helpQuantitative alignment analytics can help

Strategy

Customer

People

Process

•Connecting employee behavior to the mission and strategy•Linking teams and processes to customer needs•Reshaping strategy with real-time customer information•Creating a culture where all four elements work seamlessly

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The Main Thing

TheMainThing

The Axes of AlignmentThe Axes of Alignment

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Process Customer

Strategy

People

Horizontal Alignment

•Eliminating boundaries between company and customer•Understanding, creating, delivering and supporting customer needs•Value creation throughout supply chain•Clearly differentiated and synergistic functional responsibilities

Vertical Alignment

•The rapid and efficient deployment of business strategy throughout the organization•Employee engagement and strategic buy-in through consistent communication•Two-way flow of information through empowered employees•Enabled by measurable and actionable metrics

Challenges of Horizontal Alignment

• Customer requirements change• Customer voice hard to interpret• Customers speak in present tense• Few employees have direct interaction• Understanding the customer is rarely a

collective responsibility

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The Longitude ProblemThe Longitude Problem

Scilly Islands Naval Disaster 1707 Harrison’s Marine Timekeeper 1731Harrison’s Marine Timekeeper 1731

Big 5 Questions on Customer Focus

• What do our customers care about the most• What opportunities do we have to delight• How well are we satisfying them now• What are the “best-of-the-best” competitors

doing• What do we do to make us “difficult to do

business with?”

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Horizontally aligned companies use the Horizontally aligned companies use the voice of their customers as their beaconvoice of their customers as their beacon

The Self-Aligning Company

• Invisible hand of culture• Adjustments made quickly at all levels• Organization senses needs and changes• Distributed leadership• Disciplined enough to continually monitor

the internal and external worlds• Do the right things right and concentrate

on key metrics only

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Steps to Align an OrganizationSteps to Align an Organization

Overall Alignment Index“The Main Thing”

Category“Critical Success Factors”

Dependent Factor“Key Indicators”

SurveyQuestions

Q1

Q2

Q3

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Powerful Alignment AnalyticsPowerful Alignment AnalyticsSummary WheelSummary Wheel

“The best business tool in America” Andy Greig, Division President, Bechtel Corp

Red – alert (1-55)Yellow – opportunity (56-79)Green – best practice (80-100)

Team 2Team 1 Team 3

Comparative Alignment Dashboard

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Powerful Alignment AnalyticsPowerful Alignment AnalyticsSummary WheelSummary Wheel

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Powerful Alignment Analytics

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Powerful Alignment Analytics

Value of Alignment Analysis

•Develops long- and short-term action plans•Pinpoints areas requiring management attention•Launches improvement initiatives•Identifies skill gaps•Isolates best and worst practices•Distributes effective leadership•Aligns people, processes and strategies with market opportunities

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Process Customer

Strategy

People

Behaviour is complementary to personality

Management behavior impacts alignment

Vision, change, increasing Vision, change, increasing effectiveness, and driving things effectiveness, and driving things forwardforward

Consistency, efficiency, Consistency, efficiency, implementation, attention to implementation, attention to detail and maintaining qualitydetail and maintaining quality

Responsibility avoidance, Responsibility avoidance, conflict avoidance, or anger and conflict avoidance, or anger and annoyance.annoyance.

AcceleratingAccelerating

SustainingSustaining

BlockingBlocking

Behavior Alignment Instrument from Behavioural Sciences Ltd

Return on Alignment

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The trademarked AlignComm methodology to The trademarked AlignComm methodology to aggregate, evaluate and prioritize remediation aggregate, evaluate and prioritize remediation alternatives to determine which have the alternatives to determine which have the greatest impact on business resultsgreatest impact on business results

AlignComm AlignComm

•Strategic planning support and guidance•Workshops and seminars•Alignment and engagement surveys •Executive coaching•Behavioral Alignment diagnostics for managers•Return on Alignment ® modeling for remediation prioritization•Messaging frameworks and collateral

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